Oil Prices Rise Slightly, Market Monitors Hormuz Strait
Oil prices rose slightly after recording a significant weekly decline on Friday (June 19). This increase occurred as market participants continued to assess the prospects for a recovery in oil flows through the Strait of Hormuz, while still monitoring the ongoing tensions in the Middle East.
Brent crude rose above US$80 per barrel, reducing its weekly decline to around 8%. Meanwhile, West Texas Intermediate (WTI) for August delivery traded around US$77 per barrel. Several previously stranded vessels began to leave the Strait of Hormuz following the interim peace agreement between the United States and Iran this week.
However, market sentiment has not completely calmed down. US Vice President JD Vance postponed his trip to Switzerland for further talks with Iran. Meanwhile, the Israeli military stated that it would continue its attacks on Iran-backed Hezbollah in Lebanon. This situation means that geopolitical risk remains a major concern for the energy market.
On Thursday, vessels carrying nearly 10 million barrels of oil were seen outside the Strait of Hormuz or had begun sailing through it. In fact, a Saudi-owned tanker returned for the first time since the conflict began more than three months ago. Under normal conditions, the Strait of Hormuz typically transports around 20 million barrels of oil and energy products per day, according to the International Energy Agency.
Market-wise, the current oil rally appears to be a technical rebound following sharp selling pressure in recent sessions. However, room for upside is still limited as the market awaits evidence that the opening of Hormuz is truly stable. If ship traffic returns to normal, oil prices could remain depressed. Conversely, if tensions escalate or the opening of the Strait is disrupted, oil could again benefit from the geopolitical risk premium. (asd)
Source: Newsmaker.id
